Court Says That Copying Code Is Not Really Theft Under The Law

from the deprived-of-use dept

We've been pointing out for a while that copyright is not property and that infringement is not theft. And yet... some people can't seem to let this go -- insisting that both claims are true. Of course, one retort from our side of the discussion is the simple fact that you don't see people who copy content being charged with "theft." However, in a case that received plenty of publicity involving a Goldman Sachs employee who had copied some code from the company, he was actually charged with theft. In response, however, a 2nd Circuit appeals court panel has said he was wrongfully charged, because code is not property. The court specifically cites the Dowling case, which we've discussed on many occasions, which makes clear that infringement is a different beast than theft.

The infringement of copyright in Dowling parallels Aleynikov’s theft of computer code. Although “[t]he infringer invades a statutorily defined province guaranteed to the copyright holder alone[,] . . . he does not assume physical control over the copyright; nor does he wholly deprive its owner of its use.” Id. at 217. Because Aleynikov did not “assume physical control” over anything when he took the source code, and because he did not thereby “deprive [Goldman] of its use,” Aleynikov did not violate the NSPA.

Of course, it's somewhat unfortunate that in a ruling in which the court finds that Aleynikov has been improperly charged with "theft" under the law... they still repeatedly refer to his actions as "theft." It's too bad they did not properly note that he copied the code, but still repeatedly claim he "stole" it, as they describe his actions in passing -- but when they discuss the actual legal aspect, they admit that there was no theft.

Separately, the court rejected the charges brought under the Economic Espionage Act, noting that the law he was charged under is limited to trade secrets concerning products used in commerce, and since the code in question was for internal use anyway, it did not qualify under the law.

To some extent (and then further in a concurring opinion written by one of the judges on the panel), the court seems to suggest that it doesn't necessarily like these results (this is less clear in the official opinion, but it appears to be what the panel is implying at times), but that the problem is how Congress wrote these particular statutes. It may be true that the laws are drafted poorly, but it's important that copying code is not seen as theft, because it is not theft. Still, the overall ruling here is good, though it could have been more complete.

tldr; the court was happy that information could be stolen, but on the facts, this specific law couldn't apply.

Reading the judgment, it looks like they are quite happy that copying code *could* be theft, but in this case, under this specific law, there need to be some physical goods involved.

Iirc (and I'm no expert on US law), there's no federal theft law, so definitions of steal etc. will presumably be left to state legislation. This case concerned the National Stolen Property Act, which covers someone who "transports, transmits, or transfers in interstate or foreign commerce any goods, wares, merchandise, securities or money... knowing the same to have been stolen, converted or taken by fraud." The Court seems happy that the information has been stolen (hence the otherwise confusing references to theft), but in order for there to be an offence under the NSPA, something physical (i.e. goods etc.) must have been moved across a border.

The court does refer to Dowling, but also contrasts this case with US v Bottone, where the NSPA *was* used when information (to do with drugs) was photocopied and then taken across a border, as the papers counted as goods. The difference here (which is understandably unsatisfactory from a legal point of view) is that there were no physical goods. As the court notes "theft and subsequent interstate transmission of purely intangible property is beyond the scope of the NSPA."

The implication is that had he not merely uploaded the files to a server (in Germany?) but burned them onto a CD, and then taken that CD across a State or National border, his conviction would have been upheld. There's a brief discussion (in I B) of the fact that he later did take the code across a state border on a laptop or flash drive, but they found that the delay in copying the files to the laptop (i.e. some time after the original "theft") defeated the NSPA.

As for copyright not being property, I think people have a tendency to mistake property for physical property in these sorts of discussions. There are all kinds of different types of property, including copyright; all it means is that the rights etc. exist independent of a person (so can be transferred, identified and so on).

To contrast this with the UK (or, at least, England and Wales), here information has been explicitly ruled not to be property (most notably in Oxford v Moss, but also obiter by some of the House of Lords in Boardman v Phipps) which means that information itself cannot be stolen (as that requires property).

However, that doesn't preclude the actual copyright or patent from being stolen, but constructing a situation where that could occur is rather difficult, as one would need to actually deprive the copyright owner of their rights, not merely ignore them. I had a brief discussion with a criminal law lecturer about this a while back, and while some types of copyfraud might work (i.e. when someone claims another's copyright, and tries to enforce it against them), it is unlikely to ever see a courtroom.

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They have words they can use... Copy, Infringe, Distributed. They are choosing not to because it doesn't sound as dirty.

"John Doe copied my work and distributed copies to all his friends, this Infringes on my work's copyright and I want him to cease and desist, and I want compensation for damages that have occurred due to this infringement"

VS

"John Doe Stole my work and then Gave my work to all his friends. He needs to stop this ongoing theft of my property and pay me what I am owed for each instance of theft."

By using the term "theft" you are basically setting yourself up that one infringement = 1 lost sale. this is because you are objectifying the item copied, and compensation is for the object.

When you talk about it as infringement/damages it is about the act of copying. That act may not be even up to the value of the item. Since nothing is really gone, you can't say $X.XX in product is missing. Since most of these cases are not about commercial infringement they are not making money off of it so they have no revenue that could have potentially been yours.

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Bend over and grease it up greedtards

The infringement of copyright in Dowling parallels Aleynikov’s theft of computer code. Although “[t]he infringer invades a statutorily defined province guaranteed to the copyright holder alone[,] . . . he does not assume physical control over the copyright; nor does he wholly deprive its owner of its use.” Id. at 217. Because Aleynikov did not “assume physical control” over anything when he took the source code, and because he did not thereby “deprive [Goldman] of its use,” Aleynikov did not violate the NSPA.

Theft:
In common usage, theft is the taking of another person's property without that person's permission or consent with the intent to deprive the rightful owner of it. The word is also used as an informal shorthand term for some crimes against property, such as burglary, embezzlement, larceny, looting, robbery, shoplifting and fraud. In some jurisdictions, theft is considered to be synonymous with larceny; in others, theft has replaced larceny. Someone who carries out an act of or makes a career of theft is known as a thief. The act of theft is known by terms such as stealing, thieving, and filching.

1.criminal law - the dishonest taking of property belonging to another person with the intention of depriving the owner permanently of its possession.

We've been pointing out for a while that copyright is not property and that infringement is not theft.

Of course it's not theft. But it's still property. Funny how you ignore the fact that Congress and the Supreme Court unequivocally treat copyright as property. Funny how even you admit that under the Constitution, copyright is property as that word is used in the Fifth Amendment. Violation of property rights takes on many forms: theft, infringement, trespass. All are different, but all share the common characteristic that they are violations of somebody's property rights.

Explain to all your readers why copyright is property under the Constitution, which is the supreme law of the land, but it's not property. Please explain your blaring contradiction, Mike. Or do you enjoy lying to your readers? Don't answer that. Of course you do. It's what you do best. It's what all snake oil salesmen do.

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Looking past your assumption that everyone here is a pirate, I must point out I don't rip people off. If I was going to buy the stuff, I would've bought it. There's times I've bought the DVD then damaged it/lost it/it was stolen and as I'm not going to pay for the same thing twice, pirated it. Or moving house and I don't want to cart all the clunky DVDs and cases around, I pirate stuff I ALREADY LEGALLY OWN for convenience.

I download pre-synced Rifftraxed films in a torrent. I already bought the original DVD (or got it as a present) and I buy the Rifftrax mp3 from their site. The only reason I torrent it as well is because I'm lazy and can't be bothered to sync it all up. How am I ripping people off when I legally obtained both items?

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Explain to all your readers why copyright is property under the Constitution

You never read the US constitution did you?
Otherwise you would know that copyright was devised by the power granted to congress to stimulate learning by granting temporary monopolies if they saw fit. Copyright doesn't even need to exist as long as learning is being stimulated properly, no monopolies need exist except for the wishes of congress to do so.

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Let me clarify, though, that of course not all rights are property. Just proprietary rights, like copyright or contract rights, are. Other, non-proprietary rights, like your First Amendment rights, are obviously not property.

Pick up any text on property law, and one of the first things you'll see is the explanation that property law is concerned with the rights in property, more so than the property itself. Destroy the property, and the rights still remain. The rights are what property is all about.

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It says cannot be deprived of property. How are you tying property and copyright together? Cite something in the 5th amendment that says copyright and property are the same thing.

Here it is, in case you need it for reference:

No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

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You aren't making any sense whatsoever, and it's clear you've never studied formal property law or constitutional law. The Constitution grants Congress the power to create property rights in works, i.e., copyrights. Copyright may not need to exist, but that is irrelevant to the fact that it does exist and is property.

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The Fifth Amendment Due Process Clause says that the federal government cannot deprive you of your property with due process of law. This is what's called procedural due process. It means you get notice and a hearing before the government can do certain adverse things to your property interest. Since copyright is property, it means that the government must give you due process of law when adversely affecting your ownership interest in copyrights. If copyrights were not property, then the government could deprive its owner of their rights without notice and hearing. That's not the way it works.

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How do you think it is determined whether something is property or not? Say I went into federal court and argued that the government was violating my due process rights in my copyrights. How would the court decide if I had those due process rights in the first place? These are the sorts of questions you should be asking. Think about what it means for something to be property. If copyrights are property under the Fifth Amendment, which even Mike admits, then it's sort of silly to say that copyrights aren't really property, right? If they're property under the supreme law of the land, then it's a lie to pretend like they're not really property. Of course they are.

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Thats the thing, property is a real thing. The law is supposed to reflect what property is, it doesn't invent the definition. At least not to me. The ability to control others makes no sense to consider as something you own. You can't own rights and priviledges and abilities. You can't own legally granted powers. You can, however, own property.

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Here's the Second Circuit: "An interest in a copyright is a property right protected by the due process and just compensation clauses of the Constitution." Roth v. Pritikin, 710 F.2d 934, 939 (2d Cir. 1983).

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The meaning of the word property has changed over the years. Property rights are invented by statute all the time. You can own legally granted rights, which is why Section 201 of the Copyright Act is about the "Ownership of Copyright."

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You aren't making sense. Property is a very broad word that means a lot more than just physical objects. Property means the rights in a thing. With copyright, that thing is the underlying work that's been fixed in a tangible medium and meets the other requirements for copyright protection under the Act and the common law, e.g., it must be original. The word property is used in law to mean a lot more than you're probably used to using the word to mean.

"...but it's important that copying code is not seen as theft, because it is not theft..."

You do realize, of course, that by the stroke of a pen Congress could easily render the entirety of this opinion irrelevant? The court did not hold that the 0's and 1's were not property, but that they were not within the scope of the two criminal statutes under which the defendant was charged and convicted.

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I actually don't see the use of the term theft in the ruling as troublesome rather it's descriptive in terms of what Aleynikov did rather than legal in nature.

That is he left Goldman with material he was bound by his employment contract to keep confidential which is a civil, not criminal matter. In doing so he deprived Goldman of nothing, they still had the code and could (and do) use it in compiled form every day.

It's appearance elsewhere, as seems likely, is infringement not theft as Goldman wasn't and hasn't been deprived of anything. In finding this the court relies on a number of precedents to come to their conclusion. So the ruling appears to be on very solid ground. What they call it makes no difference.

You can certainly take whatever solace you wish in their use of the word theft but it makes no difference legally. Infringement still isn't theft.

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There's nothing dishonest about it. Copyright is property. It's treated just like property. It can be bought, sold, transferred, divided up, extinguished, etc. It can form the res in a trust. It can be left to one's descendents in a will. Etc.

What's dishonest is Mike admitting that copyright is property under the Constitution, but then pretending that it's not really property in general. That's dishonesty if there ever was an example. Mike's argument that it's not actually property requires that you pretend like the meaning of property was frozen in time centuries ago. That's not how it works. With the rise of the industrialized society has come the need and recognition of intellectual property. Just like slaves are no longer property today, things change.

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It's very simple.
The concept of property has existed for ages. You can change so it doesn't reflect that concept anymore thats fine, but it isn't honest to try to leverage the power of that concept for other things.

Uh hem...

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Yes, ownership of a copyright is property. So what? The enforcement of a copyright itself, however, is an abridgement of the property rights of others. Furthermore, infringement of copyright is not the theft of copyright ownership.

Re: Re: Bend over and grease it up greedtards

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Then of course if (since) the reason for changing the definition of a word like property that people have a strong connection with and invoked the age old concept (of actual property) is to try to get people to associate that age-old concept with something that doesn't fit that concept, then the reason is just to to deceive and manipulate people.

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Let me clarify, though, that of course not all rights are property. Just proprietary rights, like copyright or contract rights, are. Other, non-proprietary rights, like your First Amendment rights, are obviously not property.

Such rights are property -in the sense that they can be bought and sold - but that does not mean that infringment is theft.

That would be like equating trespass with "theft of land".

Theft of a copyright (if possible) would be a process ending with the thief owning the copyright not merely possessing a copy of the work.

It's something the *AA's do all the time of course when they rip artists off - but it isn't something that pirates do.

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Then let's proceed to assume that you think that after an author's life expires, copyright that lasts life + 70 years will benefit the author somehow in those 70 years. Also, let's assume that you consider suing homeless people, dead people, people without a computer, laser printers and iguanas as the epitome of goodwill and common sense.

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You don't get out much, do you? Did you only subscribe to the the 3rd tier internet package or does your entertainment industry lobbying firm's filter block too many websites?

Not only is this not a piracy-cheerleading blog, but there are plenty of actual pro-copyright infringement blogs out there where you could troll if you like. Calling this blog pro-piracy is like calling Obama a socialist. The actual pirates and socialists would strongly disagree, but you probably adhere to the all-or-nothing mentality that anyone who isn't insisting that copyright law isn't strong enough must be a pirate/copyright terrorist/dirty scumbag thief.

Get It Right

What the employee did was infringe on Goldman Sach's trade secrets. The penalty for that is defined in trade secret law, nowhere else. He might also have infringed Goldman Sach's copyright. Whether that did or did not happen is determined by copyright law. He might have committed a contractual breach, see contract law.

There are three matters (1) trade secrets, (2) copyright, and (3) Contracts. Do not get them confused. Do not charge him with an offence he did not commit, namely theft. Making that mistake will result in him walking free. Grown-up lawyers really should know this stuff, well before they start practising.

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And yet, if ideas were viewed as property by the framers of the constition, then why does the copyright clause have the "for limited times" part?

If the men who wrote the constitutional law who belived strongly to the rights of individuals to keep property saw fit to include what is clearly intended as en expiry clause for copyright and patents, then the authors clearly did not view (the executions of) ideas as a right of property.

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And yet, if ideas were viewed as property by the framers of the constition, then why does the copyright clause have the "for limited times" part?

The limited times is just part of the bargain. The author gets the copyright, i.e., the copyright, for a limited time. After which, the author's property right is extinguished and the work becomes part of the public domain. The Constitution grants Congress to create a statutorily defined intellectual property right for a limited time.

If the men who wrote the constitutional law who belived strongly to the rights of individuals to keep property saw fit to include what is clearly intended as en expiry clause for copyright and patents, then the authors clearly did not view (the executions of) ideas as a right of property.

You're starting with the false assumption that all property rights must not have expiration. That's wrong. Lots of property rights have time limits. Ever rent something? The part you're not grasping is that the word property when used in legal theory refers to the rights in a thing. Our rights in things--our property--is defined by statute all the time.

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Such rights are property -in the sense that they can be bought and sold - but that does not mean that infringment is theft.

I'm glad you agree that copyright is property. Mike even admits that it's property under the Fifth Amendment. It sure is weird how he also claims that copyright is not property without any sort of qualification. Seems downright dishonest to me. Once he admits that copyright is property as the word property is used in the Constitution, then why does he go around saying definitively that copyright is not property? The deduction is that his intent is to deceive.

But to your point, infringement is not theft is not trespass, yes, but all are forms of violating someone's property rights. But that's referring to theft, infringement, and trespass in their technical sense. It's also true that theft has a broader usage that's less technical and casts a wider net. It's hilarious to me how obsessed Mike is that everyone use the word theft only in its older, common law meaning, but that he's all too happy to lie about whether copyright is property.

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Property rights are rights in things. The thing is called the res. The res in copyright--the underlying thing--is the protected expression, i.e., the work that's been fixed in a tangible medium. The property that is copyright is actually two-fold. That original fixation in a tangible medium is my personal property. If I pull out a piece of paper that I own and write a poem with a pen that I own, there's no doubt that the resulting poem-on-paper is my personal property. That piece of paper is the res. The other meaning of copyright is the one we usually talk about, and that's my rights in that poem that are given to me, by federal statute, at the moment I fix my poem on paper. Those copyright rights are my property interest in that res. Destroy the res by burning the piece of paper and the copyright rights are unaffected.

The dishonesty is that Mike admits that copyright is property as that word is used in the Constitution, but then he says without qualification that copyright is not property. That's dishonest, and he's just playing with words. His argument that it's not property turns on the fact that the interest in copyright is defined by statute as opposed to arising naturally out of the res like with regular, tangible property. Of course, he's merely making a distinction between two types of property, tangible and intangible, but he's not actually identifying a distinction between what is or isn't property. Whether something is property is very much a question of law if there ever was one, and so it's dishonest to pretend like it's OK to just make up your own definitions of what property should be and tell your readers that that's the way the world actually is. It's not.

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The law is constantly in flux. What is or isn't property is always changing. For instance, something complicated like mortgage-backed securities didn't exist years ago, but they exist now and are very much property.

What you need to understand is that the word property refers to a bundle of rights in a thing. If that thing is your house, then there's all sorts of rights in that bundle: the electric company may have an easement, your neighbor may have a rights of use, your bank may hold a mortgage, your tenant might have a lease, etc. You are accustomed to thinking of the house as the property--and it is--but the legal view of property focuses instead on all the rights in the thing.

What is or isn't property is always in flux. It always has been. It always will be. Don't be dishonest like Mike and think that you can look to any point in time in the past that suits you and pretend like the word property today must mean the same thing it did on some day in the past. It doesn't work that way.

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If you're going to redefine words, why don't you just redefine the word "theft". Wouldn't that be quicker?

What is or isn't property is determined by custom, state law, federal law, common law, etc. The meaning of the term is always in flux. As an extreme example, slaves used to be property, but now that's obviously not the law. Similarly, mortgage-backed securities are a new form of property. Plus, property rights get created everyday through contracts and such. Property just refers to the rights in a thing.

The meaning of the word theft developed at common law, and it's clearly different than trespass (whether to land or chattels) or infringement. But there are those who use theft in a wider sense. I don't care what it's called since theft, infringement, and trespassing are all illegal and all violative of someone else's property rights.

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Yes, ownership of a copyright is property.

I'm glad we have another person agrees. It is obviously so. That's probably why Mike admits that copyright is property under the Fifth Amendment. And, of course, only his dishonesty can explain why he also says that copyright is not property when preaching to his fans.

So what? The enforcement of a copyright itself, however, is an abridgement of the property rights of others. Furthermore, infringement of copyright is not the theft of copyright ownership.

The fact that you can't even keep this straight is rather telling.

I never said that infringement was theft of copyright ownership, nor would I say that because it's not true. If you're going to say I'm wrong as least understand what I'm saying first.

How is enforcement of copyright itself an abridgement of the property rights of another? That makes no sense since if the rights belong to the copyright owner ab initio, then you don't have those property rights in the first place. How exactly are your rights being violated? What rights do you think you have?

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You do realize, of course, that by the stroke of a pen Congress could easily render the entirety of Imaginary Property (IP) irrelevant?

Congress can choose to not grant new copyrights, but if Congress tried to take away existing copyrights, there'd be an issue with the Takings Clause. Even Mike admits that copyrights are property for the Takings Clause. Ask him.

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That's funny. 'tldr' followed by a spew that's longer than the article. As to your analysis that if he'd burned it to a CD it would have been upheld, I have one quote for you that seems to defy your logic:

he does not assume physical control over the copyright; nor does he wholly deprive its owner of its use.

Since burning a CD does not equate to taking physical control over the copyright, not copyright material, I'm not following your argument from A to B.

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The law may be constantly in flux, but what is or isn't property is not in flux. The concept formally known as property was around before property laws and will still be around if there are no property laws and will not have changed. You can't change it with word play or bad laws. Even if we don't get to have a word for property anymore, it still exists and copyright isn't it.

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You're talking about the colloquial usage of the term 'theft,' which is not appropriate in a courtroom setting. You do not use colloquialisms in the court, and thus 'theft' is not something one should ever hear when a court is talking about copyright.

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That piece of paper is the res. The other meaning of copyright is the one we usually talk about, and that's my rights in that poem that are given to me, by federal statute

Yes, this is exactly what I said.

Of course, he's merely making a distinction between two types of property, tangible and intangible, but he's not actually identifying a distinction between what is or isn't property.

Well, then, one of us is misunderstanding what he's saying. My understanding is that he's saying that the expression is not property. The bit sequence is not the property of the artist. The copyright itself, that is, the limited monopoly right, is property by definition.

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When you rent something you have a proprietary interest in the thing you've rented, e.g., the right of use and enjoyment. Again, when the law refers to the property that is a house, the law is concerned with the rights in that house. If the house is under a contract of lease, then obviously the rights in the house are affected. You're right that a lessee does not own the thing he leases, but he does have possessory rights in it. His title is equitable, not legal, but that lease most certainly does give him property rights in the house.

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Only in some cases. In cases where the copyright length was extended after the rights were granted, it should not run afoul of that clause. Also, the works that were removed from the public domain should also run afoul of this clause, and be returned to the public domain immediately.

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Of course the expression is your property. The sine qua non of property is excludability. Copyright gives its owner the right to exclude others from the protected expression, subject to certain limitations such as fair use, of course. Mike on the one hand that copyright is property as the word property is used in the Fifth Amendment. Mike also say, without qualification, that copyright is not property. Those two statements are contradictory and obvious when Mike flatly claims that copyright is not property, he's not telling you the whole truth. His logic stems from a silly argument that the definition of property was fixed several centuries ago, and all developments in the law of property since then can be ignored. Give me a break. Is it different than other types of property? Of course. But it's still property as that word is used in the law and the Constitution. And given that, it's a manipulation and lie to say that it's not property. Mike does this sort of dishonest word play and twisting of logic with everything. It's why I think he's an incredibly dishonest snake oil salesman.

Re: Get It Right

Separately, the court rejected the charges brought under the Economic Espionage Act, noting that the law he was charged under is limited to trade secrets concerning products used in commerce, and since the code in question was for internal use anyway, it did not qualify under the law.

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Of course the colloquial meaning of theft is not appropriate when one is being technical. I did not indicate otherwise. There is however a growing trend to use the word in ways other than its common law meaning. I don't see the point in obsessing over it, and I was making the observation that Mike is careless with the truth when it suits him, but when someone uses the word theft in a way that he doesn't like, he gets upset. The double standard is amusing to watch.

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Well, then, we simply disagree. I believe that you are misinterpreting what Mike is saying, deliberately or not. You have yet to utter anything that demonstrate that Mike is lying or twisting facts. Everything you've said is, it seems to me, an extreme distortion of Mike's statements.

By your own logic, you are an incredibly dishonest snake oil salesman.

About expression-as-property, we obviously disagree on that point.

I am more in line with the overall attitude of the Founders. In their debates about including copyright in the Constitution, they were very concerned that if they did so, they'd be setting things up a new artificial type of "property" (what we now call intellectual property), and that this would be a corrosive and terrible thing.

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If the Founders were worried about creating intellectual property, then why would they include Article I, Section 8, Clause 8 in the Constitution. I don't follow your argument.

On the one hand, Mike says copyright is property. On the other hand, he says copyright is not property. He's obviously playing word games. He knows that under the law, copyright is property and he's deliberately lying when he claims otherwise.

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That's another issue that Mike represents--copyright is a monopoly. It is, but the word monopoly has a different meaning in intellectual property law than it does in antitrust. The antitrust meaning has negative connotations, obviously, and he's trying to import those into the IP context. Mike does little tricks like this all the time. He deliberately says things and chooses words for maximum effect, even though it's manipulative and dishonest.